Your First Attending Paycheck: White Coat Rumspringa!

I’ve got a fun post for you today. The Crispy Doc, who I imagine is crispy from either burnout, the California sun, or some combination thereof, makes an excellent analogy using a phenomenon with a fantastic name.

Rumspringa! That sounds delightful — let’s order a round for the whole table and don’t forget the little umbrellas. What’s that? You don’t serve those here? Is this because Bo forgot his ID? He’s over 21; I promise you.

Apparently, I have a poor understanding of what a rumspringa actually is. Enlighten us, Crispy Doc.


 

What is Rumspringa?

 

Children raised in Amish communities are expected to adhere to strict moral codes up until adolescence.  At that point, they get a pass: they have entered Rumspringa (literally, “run around”), a period during which they are informally cut some slack to seek secular pleasures and experience life beyond safe sects.

This rite of passage is the ultimate kung fu move: instead of fighting your teen, you co-opt her angst to bring her further into the fold. At a stage where defiance of long-observed norms could create tension, a calculated permissiveness creates an opportunity to validate the moral code you’ve taught her by allowing her to test it. Let your kid see for herself if the grass is truly greener on the other side (heck, let her smoke it!) and the hope is she’ll come to appreciate her upbringing and return to the values she was raised with.

Coming from conservative religious groups, the thinking is quite progressive. The practice reportedly fosters a high rate of retention within the community, as measured by a majority of kids (~90%) who choose to be baptized and uphold the faith. Let’s take a moment to appreciate the lives these kids are choosing to return to: barn-raising, butter-churning, bushy beards and buggy-bound broods (the average Amish family has 6 kids). The Amish understand the concepts of material sacrifice for nonmaterial reward.

 

Spread Eagle WI

 

The White Coat Version of Rumspringa

 

Every summer, new attendings across the country undergo similar temptation to defy the customs of their long-observed frugality during White Coat Rumspringa. On receiving your first real doctor paycheck, you are suddenly granted unrestricted access to a lifestyle of luxury that your resident remuneration had excluded.

Holding that new attending paycheck in hand is transformative: you become that one friend we all knew in junior high, the teen whose hormonal dam seemed to burst without warning, creating a confusing leapfrog of several Tanner stages virtually overnight. What to do with all these new, irrepressible feelings when your spending power undergoes such irrational changes?


Financial opportunists can smell new attendings in this vulnerable phase in their financial development, and they pounce.  Like the summer culling of wildebeest in the Masai Mara, financial neophytes that wander from the frugal herd are picked off by unscrupulous predators. “Doctor loans” induce deeply indebted newbies with a negative net worth to buy enormous doctor houses they cannot afford. Invitations to steak dinners inundate mailboxes like the roaches that overran New York galley kitchens when you were in med school, emanating from unsavory characters that “specialize” in doctors (suspiciously like wolves that specialize in sheep).

The prior year’s victims do a disservice to their new attending kinfolk by normalizing debt and discouraging financial discipline. Your “big sibling” who graduated residency last year picks you up for lunch in a luxury vehicle with all the extras (There’s a button for a butt massage! Is that a thing?).

During the drive, he regales you with descriptions of his new master bath, whose square footage exceeds your current apartment. You can barely hear him for the distraction of the otherworldly leather upholstery. Smells! So! Good! Last year’s suckers pull this year’s recruits into their level of debt with the easy skill of Tom Sawyer conning his friends into whitewashing Aunt Polly’s picket fence.

 

Can New Physicians Return to Their Frugal Ways?

 

In contrast to the success of the Amish, White Coat Rumspringa is far less effective at keeping newly minted physicians true to the frugal code that served them so well for so long. It takes only one or two impulsive financial mistakes to undermine decades of deliberate spending and upend a value system that took years to create.

As an undergraduate, medical student and resident, you spent years cultivating a Charles Atlas level of financial discipline by constantly and ingeniously flexing your frugality muscles.  You can’t afford to take your frugal fitness for granted.  Fortunately, like many communicable diseases, there are steps you can take to proactively inoculate yourself against becoming a new attending spendthrift.

First, seek out the inspiring financial misfits of medicine. Identify the doc in your group who still drives the beater from residency or rides a bicycle to work. Alternately, ask a nurse to point out the least resentful, most relaxed senior physician at your new job (that peace of mind is usually a tell that she’s got her financial life in order) and ask to know her secrets for sustaining career longevity and financial security.  No one else ever does, so she’ll typically be happy to share her strategies for success over a cup of coffee.

Second, open your eyes to the consequences of excessive spending and enormous debt. Ask those in your group who have been in practice for a decade which doctor’s fate you should avoid, and they’ll discreetly point out the graying partner who’s still working the night shift in the ER or the grandfather moonlighting as a hospitalist in addition to his clinical practice. But for a great deal of luck and financial discipline, that could be you.

Third, understand where your finances currently stand and decide where you’d like to be in a decade. Set achievable financial goals with explicit deadlines, and work backward from your net worth goals to allot your income accordingly.

 

Master of Your Financial Domain

 

As you set out to reach your financial objectives, tracking progress toward your goals will provide the added benefit of continually flexing your frugality muscles and maintaining your already high level of financial fitness. While the Joneses spend themselves irresponsibly into lifelong debt, you’ll become the master of your (financial) domain.

 


Track your investments for free with Personal Capital. That's how I track the PoF portfolio.  

 

The Amish are necessarily frugal (again, 6 kids per family) and set a high bar for delayed gratification, postponing rewards into the afterlife.

If they can till soil without tractors and milk without machines, there’s no reason you can’t doctor without debt.

 

[PoF: Thank you, Crispy Doc. I’ve been doctoring without debt for years now, but I can’t say I’ve tilled a lot of soil or messed around with udders. I’ve got a friend who keeps bees for honey and makes mead from it. And my wife’s pretty good at quilting, so that counts for something, right?

Readers, what did you do with your first big-boy or big-girl paycheck? After a splurge, did you return to your semifrugal ways?]

 

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49 comments

  • This is a fun article. When graduating last July, we did pursposely “splurg” on a few deliberate things. First, the nicest restaurant in our new town. My wife bought some crazy light fixture. And I bought a higher end hunting rifle. We have otherwise given ourselves a little raise since residency on monthly spending, but everything else has been planned well in advance and done to meet our 6 month financial goals.

    • Thanks for the feedback, LoaMS! The secret to your success is establishing the 6 month financial goals first, and indulging the modest splurges only once you can ensure you will meet those goals. For many colleagues, it unfortunately occurs in reverse order, with predictable consequences.

      The benefit of starting from the austerity of resident living is that every move up makes you feel thrillingly rich. A brief evolution of our light fixtures: I started med school with free halogen torchieres that graduating seniors were discarding, moved up to IKEA lighting in residency and fellowship, and felt like the world’s biggest baller when we got a fancy Sputnik fixture from Lamps Plus in my fifth year as an attending.

      • I love the Sputnik lamp.

        Also love how the word Sputnik reminds me of So I Married an Axe Murderer. ” I’m not kidding, that boy’s head is like Sputnik; spherical but quite pointy at parts!”

        Cheers!
        -PoF

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  • Good advice you got right here.

    I kept living like a student until I paid off my student loans and bought a condo. I still live the frugal life but with a few splurges here and there.

  • Great read!

    I received my first attending pay check in July. I set up everything prior to its coming to me to take everything I could off the top (403B money) and then everything else to come out the day after (4k towards student loans, 1100 towards 529, etc). That way, the day after I received it, it was much closer to the number we were used to living at during residency. In fact, even after doing that I still had some money left to enjoy.

    I do think there is a middle ground between philosophies (complete frugality and Rumspringa running away), being moderately frugal .

    You can obtain financial freedom by not going into a Rumspringa that you will never return from, but while still allowing a small amount of lifestyle creep that you have put off during medical school, residency, and fellowship. There is something to be said about obtaining wellness while you obtain wealth, instead of making wealth the end all be all.

    They are not mutually exclusive.

    • I appreciate the way you’ve structured your paycheck to minimize the risk of spending excessively. There’s a legal principle (which I’m sure I won’t do justice to) of what’s called the “attractive nuisance,” for example a pool that’s not fenced in where kids pass daily on the way to school. The idea is the owner is partly responsible for preventing kids from straying into the pool. For physicians used to living on less, our paychecks are the attractive nuisances that, left unmitigated, can drown us in debt.

      Congrats on committing thoughtfully to a path of moderation at the outset, Physician Philosopher. If only I’d had your mindset a decade and a half ago…

  • What an entertaining post! I love the wordplay and writing style. Everything from Tom Sawyer references to life on the Serengeti.

    And since I’m not a doctor my first paycheck from a real job wasn’t very large. I likely spent it on beer.

    Great job!

    • Thanks for the kind words, Accidental Fire.

      I spent my Black Friday like you’d urged me and others to do, in the outdoors on a hike with family from out of town. Spent my time, saved my money, no regrets.

  • Interesting. So the idea is to let caged chickens out and run wild for a while. Then see if they want to come back to the cage again. Nice try, good luck, ha ha.

    I feel occasional splurge is not bad (as life is short), as long as it’s not becoming a routine. By the way, the Amish culture is such a mystery to me.

    • Perhaps I’d modify your analogy so that the freed hens then build cages of their own choosing, set to their specifications, to sacrifice a bit of freedom in order to keep the foxes at bay.

      If your spending doesn’t surge, by all means splurge

      (apologies to Johnny Cochran for lacking his flair with words)

  • Nice story. I think more doctors need to pick up on what the older ones are doing. Find the older doctor who has it together and do more of what they are doing. Find the older doctor who struggles (with $, with family, with being a work-a-holic) and do less of what they are doing. That is the gem of this story.

    I remember a pastor once telling me he knew lots of doctors in town, but he only knew two who had their act together. I was one, but he never told me who the other one was. As I look back, I realize only one doctor in town ever came to me to ask how I did it. After I retired, a second doctor asked me for financial advice.

    Over a decade ago I made myself available to the physican wellbeing committee for any doctor who needed financial help or advice. That service was never used.

    I think we doctors do not like to seek help with our personal lives. We are OK with getting a medical consultation for a patient, but we are not OK with seeking a consultation for something personal. Maybe we need to rethink that one.

    Dr. Cory S. Fawcett
    Prescription for Financial Success

    • Everyone thinks Chicken Little is crazy for warning them all that the sky is falling…until Chicken Little retires young to RV across the country and write a well-received personal finance series for physicians!

      The positive role models are out there and available for those who look…thanks for sharing what you’ve learned with the rest of us, Dr. F.

  • Toby

    Wow, what a fantastically well written and thought provoking piece. The struggle to resist the debt culture is real, and insight like this can provide the needed prospective to resist the sheeple mentality.

  • Good point Crispy Doc and very well written . Cory I suspect you are right. Our egos as doctors prevents us from seeking financial help from other docs. It’s like we failed if we do that. So we hire expensive financial planners that may or may not have our best interest at heart.

    As for me, I spent some money stupidly but now 5 years out an doing ok.

    • Thanks, EJ. If we could only learn to grow our egos and our lifestyles more slowly and in lockstep, what a windfall it would be for medical professionals (and their patients!).

  • Towards the end of residency I had gained a bunch of weight due to my love of the cafeteria poutine whilst on call. I remember my first attending paycheck well. I bought ~10K (probably 20K in today’s dollars) worth of high-end weight training and exercise equipment for my basement to remove the excuse of having to go out to the gym. It worked well because guilt pushed me to make sure that I got my money’s worth. I still get use out of it, but it was excessive and I should have gone simpler. For penance, I had to move about 1500lbs of equipment twice before settling into our long-term home. Being honest with myself, I would do it again. I had had a decade of pent-up delayed gratification that I needed to let out in some form. At least it was something that has had long term usage compared to a car.

    • I feel for you, Loonie Doctor. My intern year, the automatic espresso machine was conveniently located adjacent to the frozen yogurt machine, leading to a morning ritual of affogatos (espressos poured over vanilla fro-yo). Yes, the domain name “bodybyfreehospitalfood.com” is still available!

      Investing in your health is completely understandable, and it sounds like you are still pursuing weightlifting to this day, so perhaps this was as much a passion investment as a diet corrective. Considering it didn’t leave you with a 30 year mortgage to pay off, chock it off to a live and learn moment.

      Then again, you’re biceps are probably far bigger than mine, so I’m going to go extremely easy on you and tread with great caution because you can lift heavy things.

  • moonshadow

    Kudos to Crispy and his amazing wife, whose admissions company is killing it!

    Sigh. It seems as though everyone has not just a side gig but a really amazing second career, which is insanely impressive but also intimidating.

    Keep up the work, Crispy and co.

    • Am I being followed by a moonshadow? Thanks for the generous (if undeserved) words. Sometimes the transitional / side gig you seek may not be recognizable when you first encounter it. My wife made the jump because we needed a change, not because of a secret master plan. She also kept iterating until she found a gig that worked. The numerator of one success is more impressive when one isn’t aware of the denominator of numerous failures.

      If you can get your financial life in order, cutting down on your workload or cutting out the aggravations can go a long way toward making your medical career a source of renewal. Your encore job may be your current job, just less of it.

      Take heart, and sorry for what is starting to sound like doctor fortune cookie wisdom.

  • mike

    Back in the 70s, I got a job as a millwright helper, Bethlehem Steel in Seattle. Making a cool $17K/year. The guy who did the hiring warned us not to be foolish with our new-found wealth.

  • hatton1

    Very well written indeed. Locally some of the “snake handlers” do a Rumspringa prior to getting” the Ghost”. I would be happy to mentor a younger doc but they know it all it seems. I had a conversation with a subspecialty employed surgeon recently who was talking about this new research that index mutual funds beat other funds. He is using a financial planner but did not know the AUM amount. He said it was small. I guess it is good by 40 he has discovered index funds. OTOH I mentioned the $ amount of gains I had made in the last year to a nurse (married to an engineer) that is a really good friend. She texted me last night for the name of the blogs that I read. She and her husband will be new readers to WCI and POF.

    • hatton1, I’ll be your first subscriber the day you decide to start your own blog. Appreciate your feedback all the more having followed your story and commentary on several other forums.

  • Good advice: Practice restraint for a few years and then “Come into your kingdom” and my Chief Resident used to say (He listed to sermons in the morning before the late residents arrived).

    Some of us have our Rumspringa but get seriously set back. I did… lots of debt, unsellable large house, questionable job security. It not always easy to “Be baptized and continue the Amish lifestyle” after going crazy. The best cure is prevention.

    • And yet, GLMD, there are inspiring stories of folks who were able to curb that spending trajectory and reorient along the lines of the Lifestyle Deflation you describe quite well. Not all docs will take the inoculation, but every one who survives infection will learn from the disease.

  • Ann

    I grew up near Amish country and always found the practice of Rumspringa fascinating. Anyone who wants to learn more should check out the documentary “Devil’s Playground”. I discovered before residency that increased spending does not correlate with increased happiness. I drive a 15 year old car (that I love, it is full of 15 years of memories) and live in a house that is far below “what we can afford” because I like it. If I want something, I buy it…but luckily there is not much that I want. As for asking older doctors for advice…that part made me laugh. Unfortunately, many older doctors that I know are sources for inspiration only in as much as I know that I don’t want to follow in their footsteps.

  • “Devil’s Playground” could also be the title for a documentary describing what physicians do with our first big paycheck.

    I love how you describe your car as 15 years of memories, Ann! My memories are largely manifest as various-sized shoeprints that document the past 8 years of my kids growth on the upholstery of my Kia.

  • I remember buying an overpriced bike that I don’t ride anymore (against popular Mustachian guidelines, I don’t like riding bikes), and started eating at restaurants a lot more than I probably should have!

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  • Arkad

    I remember my first paycheck. No direct deposit then. I went to the bank and cashed the check. I put aside some of the money and used those exact bills to take my parents out to dinner when they came to visit us a few months later. I guess I have told that story at home enough. My son did the same thing with his first check. I now know how my parents felt. He probably used Apple Pay to pay the check however.

    • Arkad, honoring your parents is just about the least selfish way I’ve heard someone spend their first paycheck. To have your son honor you in a similar manner should serve as an affirmation of your parenting and his values.

  • JudkinsDoesRight

    This post is timely, since I was also thinking about the concept of “smoothing” of the cost of living (from another article).

    I have a different situation, went to a state college (9k/yr), cheap med school (14k/yr) and am graduating from interventional cardiology this year. The 7 years of post-grad training allowed me to “moonlight” away all of my debt (with extreme moonlighting I was making $110k/yr) but had to slow down as we had our first, then second child.

    As it stands, we now do not have debt and are starting life with my private cardiologist income. I, personally, do not feel the need for New attending Rumspringa, maybe because we allowed ourselves to enjoy life, go on vacations and have decent cars…

    I think that having worked “even” harder in residency and fellowship, and have been more accustomed to a reasonable salary has helped mitigate this “skip in Tanner stage” type situation…

    Also, what would you do/have done in my situation? good income with no debt? where did you start?

    • You’re in an excellent situation, JDR, and you’ve put yourself in it. My path wasn’t identical to yours, but there are a number of similarities.

      I also attended state undergrad and had a full tuition scholarship. Stayed for med school, and had some scholarship money then, too. I graduated 15 years ago with about $60,000 in debt, or about a third what the average indebted student now graduates with.

      What to do now? Continue enjoying life, live on half your takehome pay, and you’ll have options that go with FI within about 15 years.

      Cheers!
      -PoF

  • JDR,

    Kudos on the work ethic and squeezing maximum value out of each educational dollar spent. You are the animal I wish I’d been, only your dad seems to have bought you that elusive copy of “Our Finances, Ourselves” a solid decade before I knew it existed.

    Given the good income/no debt situation, and the ability to avoid spending increases, I’d focus on the following 3 goals in the coming 5-7 years:

    1) If you’ve not already done so, read the holy trinity of books for DIY doc investors: Four Pillars of Investing (Bernstein), White Coat Investor (Dahle), Bogleheads Guide to Investing. Pursue the knowledge and build the confidence to never start using a financial advisor. If you fear this may take a year or two, just place all your investments into VTSAX or an equivalent total US market index fund while you decide on your asset allocation. You’ll use VTSAX as a building block in most any eventual portfolio. If you can manage your own portfolio you will save hundreds of thousands of dollars over your lifetime, and can do so with a minimal time investment annually.

    2) Invest maximally in your tax protected space. Maximize your 401k, profit-sharing plan, defined benefits plan, every tool at your disposal. Assuming youth/health, open an HSA as a stealth IRA. Do a personal and spousal Roth IRA (restrictions apply, so check the relevant articles first. PoF has this great tutorial if you decide to use Vanguard).

    3) Save up as much as possible beyond your emergency fund for a home down payment (if HCOL area) or enough to buy a home in cash outright (LCOL area). After buying the home, invest maximally in a taxable brokerage account. This is your FIRE fund, should you choose to exit medicine early. Guard it closely.

    You are two standard deviations above the rest of us at the outset of your career when it comes to finances. If you can limit your spending for your first several years out of training, your discipline will hurl you toward FI with startling efficiency.

    Go get ’em, tiger!

    CD

  • Drsan1

    I fully fell into the Rumspringa. I signed for a house with a doctor loan months before I finished residency. I bought a new car within a month of finishing residency. I furnished my home with a credit card…but there is hope. That was 10 years ago and now I’m still in the same home, I have upgraded the car but priorities are different. Growing up very modest in the inner city there were something’s I dreamed about forever…not just in residency. Definitely had to get it out my system. Now though this forum and WCI introduced me to a beautiful world of balance with spending and saving and even retiring early. I wish someone would have taught me sooner…but better late than never. Great article. I really enjoy your writing style.

    • Drsan1, it’s okay to have baggage, it just has to fit in the overhead compartment. You should be proud of how far you’ve come from your humble origins, so it’s completely understandable that you felt pent-up pressure to enjoy the fruits of your labor and discipline. Luckily medicine is a forgiving career with a generous paycheck, so even a late bloomer can modify spending with the goal of achieving financial independence.

      Now that you’ve joined “that beautiful world of balance” there’s no going back!

      Thanks for sharing your story and the kind feedback,

      CD

  • Skull Base

    Great article.

    As a member of a highly reimbursed, high ego, long-in-training subspecialty, it’s nice to remember that not everyone buys something with four wheels and an M or an S on it in August of their first year. Navigating the line between excessive frugality (is that a thing?) and relentless overspending is a main goal of next year for me. I’d rather be rich in the bank than rich in the garage, but it sure is tempting some days…

    • Mazda or Subaru?

      The longer you can keep your foot steady on the brakes of your beater car to slow lifestyle inflation, the more bariatric that bank account will grow. See if you can stick with what’s served you thus far. My current sweet ride is a used 2009 Kia Rondo, and it’s the nicest car I’ve ever driven.

      How about trying to be the brilliant eccentric surgeon known for his or her wacky ride? Used clothing habit? Turn your version of the academic’s signature bowtie into a calling card that preserves your wealth and identifies like-minded individuals.

      I’ve developed a reputation among the docs in the practice for my frugal ways – which attracts one newbie every few years who shares my nerdy excitement and seeks my advice in getting their financial house in order (It’s usually the married with three kids person rather than the living large bachelorette.)

      P.S. I enjoy your truth-in-advertising moniker, Skull Base. Perhaps I should go by Social Ills ‘N Spills?

  • I enjoyed reading the analogy.

    When I got my first paycheck, I didn’t splurge on anything. Since residency, I’ve been frugal with money but still am able to eat good food and travel the world (using miles and points). I used half to pay for my wedding and the other half to pay my student loans.

    • Quynh,

      Investing in your spouse and reducing your debts are among the wisest ways I’ve heard of spending that first paycheck. Kudos for figuring out credit card hacking earlier than most. I suspect many of your classmates were not as judicious in spending their newfound income.

      Thanks for sharing a piece of your story,

      CD

  • Dr Mom

    The wealthiest I’ve ever been was the first paycheck of residency. I could not believe I had all this money to spend. I bought a couch. A NEW couch that did not come from the Goodwill. It lasted until my children wore it out years later. Good advice. Thanks. I’m almost at FIRE though years later as we had health (and therefore financial) detours along the way. Tell others to keep plugging along. Even if you really mess up, the financial situation of most physicians allows redemption.
    Looking forward to following you.

    • Dr. Mom,

      You must be my sister in another dimension. I used my first residency check to purchase a velvet green sleeper sofa from Sears, paying for the optional protection package (ultimate rookie mistake). It moved with me through 4 apartments to my house, from LA to Boston and back again, until my wife made it clear either I or the sofa had to go.

      A close friend recently told me that parenting is all in the recovery, and I find that it holds true as well in the financial realm. It’s less about being perfect and more about learning from your mistakes.
      Here’s to hoping your path to FIRE has no more health detours.

      Fondly,

      CD

  • Financial opportunists can smell new attendings in this vulnerable phase in their financial development, and they pounce. Like the summer culling of wildebeest in the Masai Mara, financial neophytes that wander from the frugal herd are picked off by unscrupulous predators.

    I had the exact same experience as soon as I graduated pharmacy school and I love how you worded the experience. I unfortunately fell for one of these people, a friend of mine at the time, that hooked me into an expensive whole life policy while speaking to me as a “financial advisor.” Took more than a couple years to wise up and fix the mistake.

    • Jeff,

      I can’t tell you how many stories start precisely this way, with a friend or brother-in-law whose advice resulted in an expensive mistake, typically whole life insurance. In fact, righteous indignation following an experience like yours was what propelled the White Coat Investor to his current life trajectory.

      I try to find the silver linings in these circumstances – in your case, recognizing an early mistake appears to have awakened you to the importance of closely monitoring your finances. You’ll find the vast majority of professionals who follow these blogs are folks who made a mistake, learned from it, and course corrected thereafter.

      In other words, you are in great company, and the magnitude of your mistake pales in comparison to many others. Be grateful that your relatively high earning potential as a pharmacist provides a comfortable buffer to allow a quick recovery from your mistakes.

      Now that you are a card-carrying member of the hoodwinked club, you can prevent others from joining.

      Best,

      CD

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